As I have mentioned previously, the Gold Coast is the frontline of the credit driven correction occurring in Australia. I have previously expressed my concern about the flow-on effects to Queensland’s banks. Today I note that the local spruikers are back trying to talk up the market.
FOUR of 11 prestige properties were sold in an exclusive auction held by Ray White Surfers Paradise at Palazzo Versace last night.
The auction — part of RWSP’s three-day ‘Event’ — was well attended on the night and other properties are set to go over the line within days.
There were several bidders on about half the properties and the auction started well when the first lot was settled.
The luxury property at 34 Admiralty Drive, Paradise Waters, went for $4.8 million.
Some of the highly publicised properties — including an island on the Isle of Capri and a beach house at Vogue on Broadbeach — did not sell.
Ray White Surfers Paradise Group CEO Andrew Bell, who was pleased with the auction results, said he was confident the other properties ‘would settle within the week’.
”They’re really exciting properties,” he said.
Mr Bell said the prestige auction results and the sales from the morning’s Alfresco auction in Main Beach were proof the Gold Coast market had turned the corner.
I am not sure a 36% clearance rate seems that positive, but the one house they did mention seems like it got a big price. That is until you bother to check the sales history of the house at 34 Admiralty Drive, Paradise Waters only to find that it last sold for $5.8 million in July 2005. A $1 million loss over 5 1/2 years. Is it possible to turn a corner in the downwards direction ?
But not to be put off by facts, another “expert” at the same event claims we had all better jump on board before it is too late.
BUYERS looking for new Gold Coast high-rise apartments should move now or risk being shut out of the market over the next five years, according to Gold Coast real estate agent Andrew Bell.
In his annual market analysis today at Ray White Surfers Paradise Group’s The Event 2011 auctions, Mr Bell highlighted that there would be few high rises built in coming years, causing in a shortage of supply and positive price growth.
Mr Bell said new apartment stock levels had reached their lowest levels since 2003 and fewer developments were set to get off the ground.
Only three high-rise apartment projects are due for construction completion on the Gold Coast – Soul, Hilton in Surfers Paradise and H20 at Southport.
“New stock entering the market is non-existent,” said Mr Bell.
It is little wonder that there isn’t going to be any new stock for a while. Let’s remind ourselves what happened to the latest complex that was completed on the Gold Coast.
ONE of Australia’s largest apartment tower projects, the $850 million Oracle Broadbeach complex on the Gold Coast, is in receivership. The 505-apartment complex at Broadbeach was being developed by Niecon subsidiary South Sky Investments.
South Sky Investment director Michael Nikiforides placed the company into receivership.
It is the second Niecon-related business to fail.
This month the Nirvana by the Sea residential Gold Coast project was also handed over to its financier.
It is understood that the completed Oracle project collapsed because of problems with settlements of up to 400 apartments within the towers that had been pre-sold before the global financial crisis.
After the crisis hit, many were unable to come up with the cash.
The apartments had been in the process of settling since October, sources said.
This mess is far from over, and in my opinion the finance fallout has only just begun. But if you think I have got it wrong and the spruikers have got it right then you may also want to consider another one of the Gold Coast’s “investment” offerings.